An Exploratory Spatial Data Analysis of European Regional Disparities, 1980–1995

Abstract

European integration has stimulated numerous studies of regional economic convergence within the European Union in recent macroeconomic and regional science literature (e.g. Abraham and Von Rompuy 1995; Armstrong 1995a; Neven and Gouyette 1995; Martin 2001). Most of the time, the empirical methods that have been used are identical to the methods employed in international studies. However, spatial effects, particularly spatial autocorrelation and spatial heterogeneity, must be taken into account when analyzing the convergence process at regional scale. There are number of factors — trade between regions, technology, knowledge diffusion and more generally regional spillovers — that lead to geographically dependent regions. Because of spatial interactions between regions, geographical location is important in accounting for the economic performances of regions. Yet for all its importance, the role of spatial effects in convergence processes has only been recently examined using the appropriate spatial statistic and econometric methods (Armstrong 1995b; Fingleton 1999; López-Bazo et al. 1999, for European regions; Rey and Montouri 1999; Rey 2001, for US states).